Prop firm glossary
103 terms you will meet buying, passing and getting paid from a futures prop firm, plus the symbols and strategies behind them. Every term has its own page with a plain-English answer and a worked example.
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103 terms, A to Z
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1 termA
3 terms- Account SizeThe nominal buying power of an evaluation or funded account, like $50,000 or $150,000. It sets the scale of the profit target, drawdown, and contract limits, not money you can withdraw.Accounts & Evaluations
- Activation FeeA one-time fee some firms charge when you pass the evaluation, before your funded account is opened. Sometimes called a PA fee or lifetime fee.Accounts & Evaluations
- All-In PriceThe true total cost to reach a funded account: evaluation price plus any activation fee, with discounts applied.Accounts & Evaluations
B
1 termC
9 terms- CL (Crude Oil Futures)WTI crude oil futures, ticker CL. $10 per tick (one cent moves), $1,000 per dollar of oil. Fast, news-driven, and a step up in risk from index futures.Symbols & Products
- CME GroupThe exchange operator where the index futures prop traders use are listed, including ES, NQ, YM, and micros. Its data feeds and rules underpin the whole ecosystem.Trading & Markets
- Calendar DayEvery day on the calendar, weekends included, whether you trade or not. Firms that count payout days this way start a clock that runs on its own.Payouts & Funding
- CandlestickThe standard price bar showing open, high, low, and close for a time period, with a body and wicks. The visual language nearly all futures charts speak.Trading & Markets
- CommissionThe per-contract fee charged on every execution, combining broker, exchange, and clearing costs. Small per trade, decisive over hundreds of trades.Trading & Markets
- Consistency RuleA cap on how much of your total profit can come from a single day, expressed as a percentage. It forces profits to be spread across multiple days.Trading Rules
- Contract LimitThe maximum number of futures contracts you may hold at once, usually quoted separately for minis and micros and often smaller during scaling stages.Risk & Drawdown
- Contract RolloverThe quarterly migration from an expiring futures contract to the next one, when volume shifts to the new front month and everyone updates their charts.Trading & Markets
- Copy TradingMirroring the same trades across multiple accounts, either your own accounts at one or several firms, or copying another trader's signals. Heavily restricted by most firms.Trading Rules
D
5 terms- DCADollar cost averaging into a losing position: adding contracts as price moves against you to improve the average entry. Restricted or banned at some prop firms.Trading Rules
- DOM (Depth of Market)The price ladder showing resting buy and sell orders at each level around the market. The futures trader's order-entry screen and a live map of liquidity.Trading & Markets
- Daily Loss LimitThe most you may lose in a single day. A soft limit locks you out for the rest of the day; a hard limit fails the account outright.Risk & Drawdown
- Data FeedThe live market data stream your platform uses for quotes and fills, such as Rithmic or the Tradovate/CQG feeds. Prop firms bundle a feed with the account.Platforms & Tech
- DrawdownThe maximum amount your account balance may fall before the account is breached. The single most important risk rule in prop trading.Risk & Drawdown
E
6 terms- E-mini ContractThe standard-size electronically traded futures contract, like ES for the S&P 500. Ten times the size of the corresponding micro contract.Trading & Markets
- EMA (Exponential Moving Average)Exponential Moving Average: a moving average that weights recent prices more heavily than old ones, so it turns faster than a simple moving average. The most used trend line in futures day trading.Trading Strategies
- ES (E-mini S&P 500)The E-mini S&P 500 futures contract, ticker ES. The most traded index future in the world and the default instrument at futures prop firms. $50 per point, $12.50 per tick.Symbols & Products
- End-of-Day DrawdownA drawdown that only moves up at the daily close, based on your end-of-day balance. Intraday swings do not move it, making it the most trader-friendly trailing type.Risk & Drawdown
- EvaluationThe tryout phase a prop firm uses to test a trader. You trade a simulated account and must hit a profit target without breaking the drawdown or other risk rules to earn a funded account.Accounts & Evaluations
- ExpectancyThe average amount a strategy earns or loses per trade over time: (win rate x average win) minus (loss rate x average loss). The single number that says whether an edge exists.Trading Strategies
F
4 terms- Fair Value GapA three-candle imbalance where price moved so fast it left an untraded window; traders expect price to revisit the gap and often trade the fill or the reaction.Trading Strategies
- Funded AccountThe account a trader earns by passing an evaluation. Profits made in it can be withdrawn through payouts, with the firm keeping a percentage as its split.Accounts & Evaluations
- Futures ContractA standardized agreement to buy or sell an asset at a set price on a future date, traded on exchanges like CME. The instrument behind futures prop trading.Trading & Markets
- Futures TradingBuying and selling futures contracts to profit from price moves, or to hedge, without owning the underlying asset. The market every futures prop firm trades.Trading & Markets
G
2 terms- GC (Gold Futures)COMEX gold futures, ticker GC. $10 per tick (10 cent moves), $100 per dollar of gold. A trending metal market popular with overnight-capable traders.Symbols & Products
- GapA jump between prices with no trading in between, most visibly between one session's close and the next's open. Gaps act as magnets and landmarks on futures charts.Trading & Markets
H
3 terms- HFTHigh-frequency trading: automated strategies firing orders in milliseconds. Banned at virtually all retail prop firms, along with latency and fill-exploit strategies.Trading Rules
- Hard BreachA rule violation that terminates the account immediately, such as hitting the drawdown or a hard daily loss limit. Contrast with soft breach, which only pauses trading.Risk & Drawdown
- HedgingHolding offsetting positions to reduce risk, like long and short the same or correlated products. Many prop firms ban hedging within an account or across accounts.Trading Rules
I
3 terms- Inactivity RuleA requirement to place trades at least every so many days to keep an account alive. Dormant evaluations and funded accounts can be closed.Trading Rules
- Instant FundingAn account you buy that skips the evaluation entirely. You pay more upfront but start on a funded account immediately, usually a sim funded one with its own risk rules. Also sold as straight to funded or direct to funded.Accounts & Evaluations
- Intraday Trailing DrawdownA drawdown that trails your open equity in real time, including unrealized profit. The most aggressive drawdown type: a winning trade you give back can still breach you.Risk & Drawdown
K
1 termL
5 terms- LeverageControlling a large notional value with a small amount of capital. Futures are inherently leveraged, which is why small accounts can produce large profits and losses.Trading & Markets
- Limit OrderAn order to buy or sell at a specified price or better. It rests in the book until filled or canceled, trading queue position for price certainty.Trading & Markets
- LiquidityHow much size can trade at or near the current price without moving it. Deep liquidity means tight spreads and clean fills; thin liquidity means slippage.Trading & Markets
- Liquidity SweepA quick run through an obvious level (prior high, equal lows) that triggers resting stops, then reverses. Traders position for the reversal after the sweep.Trading Strategies
- Live AccountA funded account trading real capital in the live market. Usually reserved for traders who have proven themselves in sim funded accounts first.Accounts & Evaluations
M
10 terms- MES (Micro E-mini S&P 500)The micro-sized S&P 500 futures contract, one tenth of ES. $5 per point, $1.25 per tick. The standard risk-control instrument on evaluation accounts.Symbols & Products
- MNQ (Micro E-mini Nasdaq-100)The micro-sized Nasdaq-100 futures contract, one tenth of NQ. $2 per point, $0.50 per tick. NQ movement with survivable risk on small accounts.Symbols & Products
- MarginThe capital required to hold a futures position. In prop trading, the firm's margin settings, not exchange margins, decide how many contracts your account can actually hold.Trading & Markets
- Market OrderAn order that executes immediately at the best available price. Certain to fill, not certain what it will cost in fast markets.Trading & Markets
- Market StructureThe skeleton of price action: the sequence of swing highs and lows that defines trend, and the breaks of that sequence that signal change.Trading Strategies
- Mean ReversionFading extended moves back toward an average or value area, profiting when stretched price snaps back. High win rate, occasional painful losers.Trading Strategies
- Micro ContractA futures contract one-tenth the size of the e-mini, like MES and MNQ. The standard sizing tool for smaller accounts and finer risk control.Trading & Markets
- Minimum PayoutThe smallest amount you may withdraw per request, commonly $250 to $1,000. Below it, profits must stay in the account.Payouts & Funding
- Minimum Trading DaysThe fewest distinct days you must trade before passing an evaluation or requesting a payout, regardless of profit.Trading Rules
- Momentum TradingBuying strength and selling weakness while a burst of directional energy lasts, exiting when velocity fades rather than at fixed targets.Trading Strategies
N
4 terms- NG (Natural Gas Futures)NYMEX natural gas futures, ticker NG. $10 per tick with violent weather- and storage-driven swings. Widely considered the hardest major futures market to trade.Symbols & Products
- NQ (E-mini Nasdaq-100)The E-mini Nasdaq-100 futures contract, ticker NQ. Faster and wider-ranging than ES; $20 per point, $5 per tick, and the favorite of momentum-oriented prop traders.Symbols & Products
- News TradingTrading around scheduled economic releases like CPI or FOMC. Many prop firms restrict or ban holding positions through major news events.Trading Rules
- NinjaTraderA desktop futures trading platform popular with prop traders for its charting, order flow tools, and automation, typically connected through Rithmic at prop firms.Platforms & Tech
O
3 terms- One Day PassAn evaluation with no minimum trading day requirement, so the profit target can be hit in a single session.Accounts & Evaluations
- Opening Range BreakoutMarking the high and low of the first minutes of the session and trading the break of that range. A classic, rule-friendly futures day trading play.Trading Strategies
- Order Flow TradingReading the actual buying and selling hitting the book (DOM, footprint charts, delta) to time entries, instead of relying on price patterns alone.Trading Strategies
P
14 terms- P/D RatioProfit target divided by drawdown. The quickest single number for how hard an evaluation is: lower means the target is closer to your cushion and easier to reach.Risk & Drawdown
- Path to LiveA firm's published route from sim funded trading to a live capital account, usually triggered by sustained profit milestones.Payouts & Funding
- PayoutA withdrawal of profits from a funded account. Governed by rules on timing, minimums, buffers, and consistency, which differ more between firms than any other feature.Payouts & Funding
- Payout BufferAn amount of profit that must stay in the funded account and cannot be withdrawn, acting as the firm's cushion. Also called a safety net or threshold.Payouts & Funding
- Payout CycleHow often you may request payouts: on demand, daily, weekly, biweekly, or in fixed windows. Faster cycles are a major selling point.Payouts & Funding
- PointOne full unit of an index futures price, made of multiple ticks. An ES point is 4 ticks and worth $50 per contract.Trading & Markets
- Position SizingChoosing how many contracts to trade so that a normal loss is an affordable fraction of your account or drawdown. The most controllable edge a trader has.Trading Strategies
- Profit SplitThe percentage of funded profits the trader keeps. Most futures firms pay 80 to 90 percent, with some offering 100 percent on early payouts.Payouts & Funding
- Profit TargetThe amount of profit you must reach to pass an evaluation. Typically 6 to 8 percent of the account size.Accounts & Evaluations
- Profitable DayA trading day that closes with at least a set amount of profit. Firms that count payout days this way only count days you finish in the green by their minimum.Payouts & Funding
- Progressive PayoutsA payout structure where per-request caps increase with each successful payout, rewarding account longevity with bigger withdrawals.Payouts & Funding
- ProjectXA white-label trading platform stack some prop firms run as their in-house branded platform, covering web trading, data, and account management.Platforms & Tech
- Prop FirmA proprietary trading firm that lets traders trade the firm's capital instead of their own. Futures prop firms sell evaluations; pass one and you trade a funded account and keep a share of the profits.Accounts & Evaluations
- Pullback TradingEntering in the direction of an established trend after a counter-move retraces to an area of interest, rather than chasing the move itself.Trading Strategies
R
6 terms- RTY (E-mini Russell 2000)The E-mini Russell 2000 futures contract, ticker RTY. Small-cap index exposure at $50 per point, $5 per tick, with sharper spikes and thinner books than ES.Symbols & Products
- Range TradingBuying the low edge and selling the high edge of a sideways market, profiting from oscillation instead of direction.Trading Strategies
- ResetPaying a fee to restart a failed evaluation fresh, keeping the same account size and rules. Usually cheaper than buying a new evaluation.Accounts & Evaluations
- Risk-Reward RatioThe ratio between what a trade risks and what it targets. A 1:2 trade risks $100 to make $200. The lever that makes modest win rates profitable.Trading Strategies
- RithmicA low-latency futures data and order routing provider used by many prop firms, known for its R|Trader software and connections to platforms like NinjaTrader.Platforms & Tech
- Round TurnOne complete trade cycle: an entry and its exit, two executions. Futures costs and volume stats are often quoted per round turn.Trading & Markets
S
10 terms- SI (Silver Futures)COMEX silver futures, ticker SI. 5,000 ounces per contract with $25 per half-cent tick. Notoriously fast and unforgiving; the micro SIL is the sane entry point.Symbols & Products
- Scaling PlanA schedule that unlocks more contracts as your funded balance grows. You start with partial size and earn the full contract limit at balance milestones.Risk & Drawdown
- ScalpingA style of taking many quick trades for small profits, holding seconds to minutes. Allowed at most futures prop firms, though some restrict sub-second or tick-scalping extremes.Trading Rules
- Settlement PriceThe official daily closing price the exchange publishes for each contract, used to mark accounts, margins, and most end-of-day drawdowns.Trading & Markets
- Sim Funded AccountA funded account that runs on simulated capital. Your trades never reach the live market; the firm pays real payouts from its own revenue based on your simulated performance.Accounts & Evaluations
- SlippageThe difference between the price you expected and the price you got. Grows with speed, size, and thin books; shrinks with liquidity and limit orders.Trading & Markets
- Static DrawdownA fixed drawdown that never trails. The breach level is set from the starting balance and stays there no matter how much profit you make.Risk & Drawdown
- Stop LossA resting order that closes your position when price reaches a chosen level, capping the loss on a trade automatically.Trading & Markets
- Support and ResistancePrice zones where buying (support) or selling (resistance) has repeatedly stopped the market. The base layer of most futures trade plans.Trading Strategies
- Swing TradingHolding positions overnight or across multiple days. In prop trading it depends on the firm allowing positions outside regular hours, which many futures firms do not.Trading Rules
T
6 terms- TickThe smallest price increment a futures contract can move, with a fixed dollar value per contract. ES ticks are 0.25 points worth $12.50.Trading & Markets
- Trade CopierSoftware that replicates orders from one account to others in real time. Allowed within limits at some firms for personal accounts, banned across firms or across people.Platforms & Tech
- Trading DayAny day you place at least one trade, win or lose. Firms that count payout days this way only need you to show up and trade.Payouts & Funding
- Trading Sessions (RTH and ETH)Futures trade nearly 23 hours, split into Regular Trading Hours (the US day session) and Electronic/overnight hours. Liquidity, behavior, and many prop rules differ by session.Trading & Markets
- TradovateA browser-based futures platform with its own data and clearing stack, widely offered by prop firms as the no-install option.Platforms & Tech
- Trend FollowingTrading in the direction of the prevailing move and holding while it persists, taking many small losses for occasional large winners.Trading Strategies
V
3 terms- VWAPVolume Weighted Average Price: the session's average price weighted by volume. The intraday fair-value line traders trade toward, away from, and around.Trading Strategies
- VolatilityHow much and how fast price moves. High volatility widens ranges, targets, stops, and risk all at once; low volatility compresses them.Trading & Markets
- VolumeThe number of contracts traded in a period. Confirms conviction behind moves and marks the prices where the most business was done.Trading & Markets
W
1 termY
1 termZ
2 terms- ZB (30-Year Treasury Bond Futures)CBOT 30-year US Treasury bond futures, ticker ZB. Trades in 32nds of a point, $31.25 per tick. The slow, deep rates market prop traders use on macro days.Symbols & Products
- ZN (10-Year Treasury Note Futures)CBOT 10-year US Treasury note futures, ticker ZN. Trades in half-32nds worth $15.625, with enormous liquidity and a measured pace suited to spread-style trading.Symbols & Products